PG&E: Guilty verdict for obstructing investigators after deadly pipeline blast

Image 1 of 4

SAN FRANCISCO (KTVU & wire reports) -- A federal jury has reached a guilty verdict in PG&E's criminal trial, saying the state's largest utility obstructed the federal probe of the blast and violated a pipeline safety law before and after the fatal 2010 pipeline explosion in San Bruno.

Jurors found PG&E guilty Tuesday of five felony counts of willfully failing to inspect and test its gas lines and the obstruction count. The jury found the company not guilty of six other pipeline safety violations. The case was argued in front of U.S. District Judge Thelton Henderson.

In a written statement, the utility said it had learned from the past.

"While we are very much focused on the future, we will never forget the lessons of the past. We have made unprecedented progress in the nearly six years since the tragic San Bruno accident and we are committed to maintaining our focus on safety," the statement said. "We want our customers and their families to know that we are committed to re-earning their trust by acting with integrity and working around the clock to provide them with energy that is safe, reliable, affordable and clean.”

Steven Bauer, a spokesman for the law firm of Latham & Watkins and Clarence, Dyer & Cohen, declined comment, saying only in a written statement: "We would like to thank the jurors for their hard work during their long deliberations. We will file our motion for acquittal on the remaining counts next week."

PG&E was facing millions of dollars in fines if jurors agree that PG&E gained by breaking the state's safety law. According to a report in the SF Gate, the maximum the company could be fined would be $3 million because a ruling by Henderson said the state could not use newly approved state safety standards to show illegal cost-cutting.

The verdict was handed down after about six weeks of testimony, closing arguments and jury instructions.

Prosecutors had argued that PG&E put profit over safety. But the company's lawyers argued that the utility's workers were making decisions as best they could and no willful violations occurred.

The company had been charged with 11 counts of violating the U.S. Natural Gas Pipeline Safety Act's requirements for keeping records on high-pressure natural gas transmission pipelines, identifying and prioritizing potential risks such as cracks and manufacturing defects, and conducting appropriate safety tests.

The violations allegedly occurred in connection with several Peninsula and East Bay pipelines, including Line 132, the transmission line that ruptured and exploded in San Bruno on Sept. 10, 2010.

The explosion and ensuing fire killed eight people, injured 66 others, destroyed 38 houses and damaged about 70 others.

One neighbor pointed out that the family has moved away after losing loved ones in the pipeline disaster. 

"You can't help it, you get flashbacks. You do actually get visuals," said Nellie and Bill Bishop in reaction to Tuesday's verdicts. "How do you put a price on lives and negligence," said Nellie Bishop. 

The Crestmoor neighborhood is now lined with new or rebuilt homes. 

"It blows up a neighborhood. You kill eight people. Six years later we're still not put together. You get a slap on the wrist and told not to do that again," said Bill Bishop. "Amazing," says Nellie as Bill chimed in," It makes no sense to me." 

"In my opinion, PG&E won big," said Michael Cardoza, a legal analyst. He sees no real long-term impact on the utility company. 

"What are we going to do? Go out and cancel PG&E. I mean they've got a monopoly here," said Cardoza.

"We are very gratified in San Bruno that six of these counts were convictions. The jury found out over the past six or seven weeks what we've known for years...that PG&E put profits ahead of safety. And as a result, 8 people lost their lives and a neighborhood destroyed. We never want this to happen anywhere again," said San Bruno Mayor Jim Ruane in a phone interview with KTVU.

As for the Bishops, they say they suffer from post traumatic stress disorder. The couple saved a piece of asphalt that came crashing onto the roof of their home on the night of the explosion. They say they're lucky they weren't hurt physically and the damage to their home was repaired, but they say justice was not served. 

PG&E is also charged with one count of obstructing a National Transportation Safety Board investigation of the blast by misleading the board about its policy on testing older pipelines such as Line 132. The NTSB concluded the cause of the explosion was a defective seam weld on a pipeline segment that was installed in 1956, incorrectly listed in PG&E records as seamless and not appropriately tested and repaired.

The judge has not yet set a date for announcement of his decision on the penalty.